If anyone depends on your income and would stuggle financially after your death, you most likely need to purchase life insurance. A life insurance policy would provide your family or dependents with money after you're gone to make sure they are able to take care of your funeral costs, living expenses, and other financial responsibilities that they relied on you for.

For more info, check out our guide: Determining If You Need Life Insurance Coverage

Determining how much life insurance coverage you need means trying to determine how much money your family will need for the future. As a general rule, you will want to carry coverage of at least 10 times your current annual salary, but 15 to 20 times is recommended. However, your family may require more or less, depending on your specific situation and financial needs.

When trying to figure out how much life insurance you should buy, you need to determine how much money your family needs to maintain their standard of life for years to come.

First, take inventory of all of your current financial committments and any possible future obligations your family will have to deal with.

Then, compile a list of all the financial resources your surviving family members will have access to, such as their own salary, savings, investments, property, and any life insurance that you already own.

Next, subtract these resources from your total current and future financial duties to help determine how much money your family may need.

For more info, check out our guide: Determining If You Need Life Insurance Coverage

Not all life insurance policies are the same. There are four basic types of life insurance available: Term Life Insurance, Whole Life Insurance, Universal Life Insurance, and Variable Life Insurance.

When choosing the right policy to match your specific needs, determine if your goal is to protect the "here and now" or if you are focused more on long term needs. If you're looking to protect your current income and cover all of your current debts, a term life, or protection-type policy, is best. If you are looking further down the road and are concerned with your long term needs, a whole life, or investment-type policy, would be best.

For more info, check out our guide: Life Insurance Policies to Match Your Needs

Although your child is very young, dependent, and not earning any income, you can still benefit by purchasing a life insurance policy for them. Term life policies for children are very affordable and often cover your child until they reach the age of 25. If something does happen to your child, the death benefits can ease the burden of funeral and burial costs.

When your child is young and healthy, they will receive the best rates possible because the likelihood that they will die is much less because of their young age. Purchasing a whole life policy for your child now while they are at a younger age can be cost-effective because it offers lifetime coverage and does not end after a set period. When they reach adulthood, your child can keep the policy active by taking over the premium payments. Whole life policies also accumulate value, tax-free.

There are five general health classifications used by insurers to evaluate individuals applying for a life insurance policy: Preferred Best, Preferred, Standard Plus, Standard, and Tobacco.

• Preferred Best - Preferred Best is reserved for the healthiest individuals with no major health issues or family health history, proportionate height and weight, and not currently taking any medication.
• Preferred - Preferred means that the individual is healthy, in good physical shape, but is currently taking medication or has a family history of having a specific health problem.
• Standard Plus - Standard Plus is given to individuals who have above average healthy conditions, but may have a history of illness or may have recently gotten over an illness or quit using tobacco products.
• Standard - Standard rating means that the individual has average health or is overweight. Most people fall into the category of standard.
• Tobacco - The tabacco rating is automatically given to individuals who smoke or use tobacco products on a regular basis.